Thursday, December 31, 2009

2010; Here we come!

Phew, 2009 is almost through and what a year it has been. I am sure everyone would be looking forward to 2010 with a lot of hope and wishes for positive things to happen and hear about.

Although personally 2009 was not too bad and is the year which saw the start of “An Indian and A Retailer” as also its rapid acceptance and widespread popularity as seen from the 10K plus walkins in less than a year. Thanks to all of you for that.

2010 is awaited and everyone might have a wish list or two. May as many wishes as possible come true for everyone. The coming year is expected to be a milestone in terms of how economies manage the recovery, how companies leverage opportunities that are sure to emerge in the recovery phase. Indian Retail is also expected to have an exciting journey and a few things that I expect to happen are –

  • Consolidation - either by collaboration or purchase. There is not enough of aggregation of volumes for a true retail play and this might change with either collaboration in the back end or simple M&A.
  • Coming of age of the conventional outlets: The humble Kirana proved that their business model is not only sustainable but also recession proof and robust. With increasing awareness and education I am sure that this hardy tribe would leverage their business model to become better and more competitive.
  • Beyond ERP: Post the scramble to implement the big bucks ERP everyone was struggling to get it right and in no mood to look at any other IT initiative. A whole host of tactical and strategic IT solutions exists and now is the time for Retailers to start exploring and exploiting such solutions.
  • GST? I am not brave enough to predict that GST would come in and change the way trade happens in India. But, I definitely hope that this happens soon and in 2010 itself. As also, I wish that the government starts recognizing Retail as an important industry segment and accords it due recognition and support.
Will sign off 2009 with my Best Wishes to all of you for a Very Happy New Year and hope that all your wishes and plans come true.

Sunday, December 20, 2009

What an idea!

Sometime ago while I was browsing in a supermarket I noticed a person checking out products on the shelves and then fiddling with his mobile phone with a stylus. He would again check out something on the shelf and shift his attention back to his mobile. At first I thought he is one of ‘those’, people who are chronically addicted to their mobiles. Having seen increasing instances of such mobile centric behavior, I have a strong thought that human evolution might lead to ears with Bluetooth like capabilities and fingers which are more like the stylus.


Coming back to the story, I realized that the person was actually noting down something from the shelves. I could think of only two possibilities; one being that he was checking the stocks or he was checking the prices and was from a competing store.

(Please overlook the poor quality of the picture as it was taken with my mobile in indoor lighting)

My curiosity was piqued and I approached him to enquire. He was indeed taking stock and also taking down the requirements for each of the SKUs as he was the distributor’s representative. Being very impressed by this use of technology I requested a picture of his devise, which is what one can see here.

It is indeed heartening to see the slow intrusion of such technology into Indian Retail which has typically chosen man power options in the technology vs. people cost benefit analysis.

This person visits the stores, checks the stocks and captures the requirements, goes back to office and updates everything by plugging his phone to a computer. Technically he need not even go to the office and can do this from anywhere by sending it over a call or as a message.

This is just a representative use of technology in retail which is today affordable and helps increase efficiency and productivity. More importantly, the accuracy increases vastly in a context where data accuracy was guestimated to be anywhere from 60% to 80%.

Of course there are myriad such things which can bring about significant operating changes and shall detail a few in the coming posts.

Lastly one should remember why adopting such technologies is considered difficult in the Indian context. It is simply a matter of cost.

Quite a few number of years ago when a new store was being planned, the debate was about having a hand held, radio frequency based device to manage stock receiving, inventory checking, etc. versus having it done manually. Needless to say the manual way won out because the other option costed some 3 or 4 times that of doing it manually. With technology costs coming down (take the case of Netbooks) Indian Retail might find the time right to explore some interesting technological options in several functional areas. However, the fact of the matter is that a device that appears affordable at USD 1,000, might trigger second thoughts because; at INR 45,000 for a 3,000 sq. ft. store, it is Rs. 15 per sq. ft. and the meter starts ticking if multiple such devices are required to make it effective.